Things to Read at Lunchtime on March 11, 2015
Must- and Shall-Reads:
- : “The thing is, we’ve been here before. “In the early-to-mid 1990s… unemployment had already fallen to [the estimated NAIRU]. But inflation wasn’t actually rising. So Fed officials made what turned out to be a very good choice: They held their fire, waiting for clear signs of inflationary pressure. And it turned out that the United States’ economy was capable of generating millions more jobs, without inflation…. Are we in a similar situation now? Actually, I don’t know–but neither does the Fed. The question… is what to do in the face of that uncertainty…. To me… the answer seems painfully obvious: Don’t… pull that rate-hike trigger, until you see the whites of inflation’s eyes…”
- : Labor Market Slack and the Affordable Care Act
- : The Pincer Attack on Macro Models
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: TPP at the NAB: “As with many ‘trade’ deals in recent years, the intellectual property aspects are more important than the trade aspects… the US is trying to get radically enhanced protection for patents and copyrights… Hollywood and pharma rather than conventional exporters…. Well, we should never forget that in a direct sense, protecting intellectual property means creating a monopoly–letting the holders of a patent or copyright charge a price for something (the use of knowledge) that has a zero social marginal cost… a distortion that makes the world a bit poorer. There is, of course, an offset in the form of an increased incentive to create knowledge…. But do we really think that inadequate incentive to create new drugs or new movies is a major problem right now? You might try to argue that there is a US interest in enhancing IP protection even if it’s not good for the world, because in many cases it’s US corporations with the property rights. But are they really US firms in any meaningful sense? If pharma gets to charge more for drugs in developing countries, do the benefits flow back to US workers? Probably not so much…. Why, exactly, should the Obama administration spend any political capital–alienating labor, disillusioning progressive activists–over such a deal?”
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: Weblogging: “I began blogging… due to dissatisfaction with how economic issues were being presented in the mainstream media…. Blogs have changed this. The reporting today on economic issues is so much better than it was then, and that is due in no small part to the interaction between reporters, the public, and academics willing to blog and put complicated, technical matters into terms that the general public can understand. Reporters have access to a much broader array of informed voices than ever before…. A few people who wrote about economics in the blogosphere, mostly non-economists, have moved on and I wish them the best of luck. But economics blogging isn’t dead, far from it…” -
: Jobs, Automation, Engels’ Pause and the Limits of History: “Median wages and living standards are stagnant… having decoupled from productivity growth for several decades. Income inequality has climbed…. High profits have not been redeployed as significantly more investment. Anecdotal evidence of remarkable new technologies suggests that the effects on the economy will be profound, but it’s not clear how…. Sound familiar?… I’m talking about the UK in the first four decades of the nineteenth century, a period that economic historian Robert C Allen has labeled “Engels’ Pause”…. The lazy-but-common retort to the idea that technological advancement would massively displace workers has long been to accuse the fear-monger of having perpetuated the lump of labour fallacy. Luddites!…” -
: The Fed Under Fire: “Fed officials… while they would prefer not to re-litigate… 2008… their decisions are still not well understood and that officials must do more to explain them…. Fed officials should avoid weighing in on issues that are only obliquely related to monetary policy…. Fed officials should acknowledge that at least some of the critics’ suggestions have merit. For example, eliminating commercial banks’ right to select a majority of each Reserve Bank’s board would be a useful step in the direction of greater openness and diversity.
The Federal Reserve System has always been a work in progress. What the US needs now is progress in the right direction.”
Should Be Aware of:
- Looking for Hungry Grizzlies—on Purpose
- : ACA Troofers Uncover Another Conspiracy
- : “People who use… ‘food stamps’ tend to make healthier food choices than those who don’t use SNAP…. To impose the easy virtue of the well-to-do on the poor is to request the most stressed and vulnerable members of society to display impossible moral heroism…. If the problems plaguing poor communities persist after poverty is drastically reduced, that would seem an appropriate time to pursue the matter of a better ‘moral vocabulary’…. But before that conversation can happen, the obvious solution to the ‘chaos’ Brooks observes among poor communities is to reduce poverty, and let its moral quandaries resolve on their own.”
- : “Why do I keep harping on this?, I’ve said this before and I’ll say it again: Journalism is important. Eternal vigilance is the price of liberty. The press is the fourth branch of government. So, yeah, it’s worth banging on this. As a statistician, I see no embarrassment at being irritated when a prominent journalist [like David Brooks] throws around fake-o numbers that just happen to advance his political agenda. It’s tacky tacky tacky, and if he’s going to have the bad taste to go on about morality like this, then, yeah, damn straight I’ll call him on it.”
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: Anaphoric definiteness in the ACA: “In the phrase ‘an Exchange established by the State under 1311 of the Patient Protection and Affordable Care Act’ the definite expression ‘the State’ is used anaphorically. Its antecedent is the phrase ‘a State’ in ‘health plans offered in the individual market within a State.’ The anaphoric relation enforces a legal requirement that the state that the health plans plans are offered in be the same state as that which set up the enrolling Exchange…. If an indefinite had been used instead (or, as some have suggested, the disjunct ‘…or the federal government’), the required relationship between the health-plan offering State and constraints on its Exchange would be broken. A plan could be offered in one state and (theoretically) enrolled in by an exchange set up by another. In fact, each of the eight uses of the phrase ‘an Exchange established by the State…’ in the ACA involves such an anphoric use… the idiom favored by Congress to set up this kind of linked requirement…. This required anaphoric relation — specifying, for example, that the state establishing procedures for ensuring childhood coverage is the state whose exchange is providing coverage – makes a crucial contribution to the meaning of the statute, and provides a rationale for the inclusion of the phrase ‘…established by the State…’ in these eight passages in the statute…. The participle ‘established’ came along for the ride. But the crucial thing was that a relation should be set up between an Exchange and a (previously mentioned) State.” -
: Why Is the GOP-led Congress Making Such a Hash of Foreign Policy?: “Armed with a pretty strong midterm election performance, the GOP-controlled Congress came to power with legitimate policy disagreements with the president and some legitimate gripes about the process…. It wasn’t just Republicans, either…. And yet, over the past two months, the Republican-controlled Congress has managed to go from one blunder to another…. It takes real effort for people, such as Les Gelb, David Ignatius, Fred Kaplan, Richard Haass, Phil Zelikow et al, to get off their bipartisan fence and blast one party for acting recklessly on foreign policy–and yet Sen. Tom Cotton’s letter has managed to pull it off. And how has the GOP reacted to all of this?… Some doubling down… [but also] reports that many GOP members of Congress are surprised and a bit chagrined by the blowback…. If the GOP response ranges from sheer denial of a problem to ‘¯_(ツ)_/¯’, that’s a sign that they’re not serious at all about foreign policy…. Let me suggest three drivers: 1) The executive branch has a structural advantage on foreign policy…. 2) Congress ain’t what it used to be. These kinds of stunts would have been vetoed by party leaders in Congress even a decade ago…. But an awful lot of the GOP Senate caucus is new… and you have the old bulls, such as Sen. John McCain saying things like, ‘I saw the letter, I saw that it looked reasonable to me and I signed it, that’s all. I sign lots of letters.’ Which is code for, ‘what was in that letter again?’ 3) To get ahead in the GOP, you need to be a disruptor…. The effect such stunts have on foreign policy are secondary…. Two months into the new Congress, the GOP has squandered what was supposed to be a political and policy advantage for them. And they’ve squandered it badly.”